I lived and worked in Shanghai and Hong Kong for almost two decades and now write primarily on China, Asia, and nuclear proliferation. I am the author of two Random House books, The Coming Collapse of China and Nuclear Showdown: North Korea Takes On the World. My writings have appeared in The New York Times, The Wall Street Journal, Barron’s, Commentary, and The Weekly Standard, among other publications. I blog at World Affairs Journal. I have given briefings in Washington and other capitals and have appeared on CNN, Fox News, MSNBC, Fox Business, Bloomberg, CNBC, and PBS. I served two terms as a trustee of Cornell University.

Foxconn Technology Group sent Apple Inc. stock reeling on Wednesday. Shares plunged 2.4% on reports that the world’s largest contract manufacturer of electronics—and Apple’s largest assembler—had imposed at its Chinese plants a hiring freeze lasting until at least the end of next month. The Financial Timesattributed the unusual move to slowing production of the iPhone 5.

Foxconn, the trading name of Hon Hai Precision Industry, denied the FT report, stating that hiring was put on hold because an unusually high proportion of workers returned to their jobs after the long Lunar New Year break. In Shenzhen, for instance, more than 97% of the 400,000 employees reported back to duty. That, in the words of spokesman Louis Woo, was an “unprecedentedly high” rate. In a statement, Foxconn said the freeze “is not related to any single customer and any speculation to the contrary is false and inaccurate.”

Reports in the Chinese-language media indicate the Financial Times got it mostly right, but the big story is not the percentage of returned workers or whether Apple’s phone sales are suffering. The big story is what Terry Gou, Foxconn’s founder and chief executive, said about his upcoming investment plans.

Last Monday, Gou announced that Foxconn’s next major expansion push would be focused on Taiwan, where he wanted to put plants in New Taipei City, Taichung, and Kaohsiung. This comes at a time when the company is putting off the expansion of one of its China facilities, in Zhengzhou.

Gou founded Foxconn in Taiwan in the 1970s, and moved manufacturing away from the island republic to Shenzhen at the end of the 1980s. Now, he is beginning to reverse the process. Moreover, Gou is committing even more funds outside China. For instance, Foxconn will soon open facilities that will employ another 10,000 workers in Brazil. At the same time, he is negotiating with authorities to commit as much as $10 billion to factories in Indonesia.

And then there is the good ole U.S.A., where Foxconn already makes server parts in California and Texas. Said Louis Woo, the spokesman, “We are looking at doing more manufacturing in the U.S. because, in general, customers want more to be done there.”

One of those customers would, of course, be Apple. CEO Tim Cook, in an interview last December, said his company will spend more than $100 million this year to build Mac computers in America. “This doesn’t mean that Apple will do it ourselves, but we’ll be working with people and we’ll be investing our money,” he said.

The Apple boss did not give many details. A few points, however, seem clear: Cook, with his reference to “people,” was looking to partner with Foxconn in the U.S., production would be shifted from China, and more than just final assembly will take place in America.

Foxconn, China’s largest private-sector employer, looks as if it should be firmly tied to the People’s Republic. About 1.5 million of its 1.6 million workers are there, and its operations in Mexico and Europe seem marginal to its business. Yet now it’s evident that, despite everything, the company’s growth will be outside China.

Why should Gou leave the country that made him rich and famous? There are, for starters, spiraling wages, worker discontent, forced unionization, tough environmental enforcement. But the big factor today—and the one no one thought about three years ago—is political risk. Beijing wants territory controlled by its neighbors and, as a result, China is getting itself into nasty scrapes, especially with Japan. Moreover, the Chinese have designs on the sovereign state of Taiwan, which they consider their 34th province. For IT companies, China’s friction with these two countries is a problem because many of their products rely on Japanese and Taiwanese components.

And the Chinese have not only gone after neighbors. Since late 2010, Beijing has sought to punish American, European Union, and Norwegian companies for perceived misdeeds of their governments. In Norway’s case, it was the award of the Nobel Peace Prize to dissident Liu Xiaobo that started a multi-year Chinese war against salmon imports from the Scandinavian country.

Costs can always be passed on to customers or absorbed. Supply chain disruptions, however, can kill a business. Beijing’s retaliation last September against Japanese companies showed that China is no longer a reliable member of global supply chains.

Beijing, unfortunately, seems undeterred by the bad publicity it has earned from serial tantrums and hissy fits. In October, even the dovish Ministry of Foreign Affairs got in on the act by formally announcing its Department of International Economy, an apparent attempt to throw China’s economic weight around.

As Beijing seeks to use its economic leverage to obtain geopolitical objectives, companies will have no choice but to reduce their China exposure. This comes at a time when economic factors are already pushing foreign businesses away.

China attracted $9.3 billion in FDI—foreign direct investment—last month. That figure is 7.3% less than the amount attracted in January 2012. The falloff, the steepest since a 9.9% drop in November 2009, means that last month was the worst January in four years.

And the downward movement seen last month was not an aberration: 2012’s FDI of $111.7 billion was off from 2011’s $116.0 billion pace.

Because FDI is a proxy for foreign confidence in Chinese manufacturing, it looks as if business is beginning to have second thoughts about concentrating facilities in the People’s Republic. And when even Foxconn is planning to move production back to Taiwan, we know there is trouble on the factory floor in China.

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Did you actually write, “tough environmental enforcement” — Come on. China has a horrible environmental record – the air is filthy and their water polluted with industrial waste. If there was ever a poster child for what happens when big government and big business get married – it’s China.

Everybody who has had work done in china has had their trade secrets stolen by the Chinese and they do their best to minipulate their customers in every which way. So get businesses out of china and for american companies bring their work back to the US and for others transfer that work to some other country that is not communistic or dititorial as the same thing will happen again.

It used to be the other way around, with companies shifting production from Taiwan to China to escape Taiwn’s high cost of labor, but quality in China at the time was questionable. With production moving back to Taiwan, all China need do is take over Taiwan and there is no one to stop them. China’s masses are poor and could some day revolt? China has a huge labor force but I think the weakness of China is an inadequate supply of tillable land to feed their people and inadequate resources to fuel their economy.

Indeed Democracies don’t fight wars against other democracies. Except the following wars where democracies actually fight wars against other democracies. 18th century

The American Revolutionary War.[8] The Fourth Anglo-Dutch War of 1780-1784.[9] Pennamite-Yankee War of 1784, which was a confrontation lasting three decades over land claims pitting settlers (and their local militias) from Pennsylvania against those from Connecticut and Vermont. The state governments were not directly involved; but both Pennsylvania and Connecticut asserted jurisdiction and the war was fought by the Pennsylvanania and Connecticut militias under state authority.[10] Pennsylvania had been among the most democratic of the Thirteen States since the revolutionary Pennsylvania constitution of 1776, which included tax-payer suffrage and annual elections;[11] Connecticut had had annual elections even before the Revolution, and had retained its form of government – Connecticut of the 1780s was becoming more democratic and egalitarian;[12] Vermont was an independent and democratic republic, not part of the United States.[13] The Quasi War from 1798 to 1800 between the United States and the French Republic. [edit]19th century

War of 1812[14] Belgian Revolution against the Netherlands of 1830-8[15] Mexican–American War [16] Sonderbund War[15] War of 1849 between the Roman Republic and the Second French Republic[17] War of 1859 between Peru and Ecuador.[18] The Fenian Raids – Border conflicts between Irish-American elements and British Canada Spanish-American War[19] First and Second Boer Wars.[20] Second Philippine War.[21] [edit]20th century

First Balkan War (1912–13). The Young Turks had re-established constitutional government in Ottoman Turkey in 1908,and continued to struggle for greater liberalization;[22] the “relatively democratic” Constitution of Serbia had been restored in 1903, and attained complete openness of executive recruitment. Serbia and its allies, the constitutional monarchies of Greece and Bulgaria, won the war; Turkey suffered a military coup as a result of defeat.[23] First World War. The Polity IV dataset does not rank any of the Central Powers as democracies, although the component of democracy for Germany had been higher than that of autocracy since the 1890s, when Bismarck was replaced by Leo von Caprivi;[24] neither does the somewhat controversial[25] ranking of Tatu Vanhanen;[26] on the other hand, all of the Central Powers had elected parliaments; the Reichstag had been elected by universal suffrage, and voted on whether a credit essential to the German conduct of the war should be granted. Whether this is democratic control over the foreign policy of the Kaiser is “a difficult case”; Michael W. Doyle concludes, however, that the government was not absolutely dependent on the Reichstag – and that Germany was a dyarchy, effectively a mixture of two different constitutions, and democratic on internal affairs.[27] Polish-Lithuanian War: Fought in 1920, with about 1000 estimated battle deaths. In both states, elections had been held with universal suffrage. In the polity scale, Poland received a +8 rating in combined democracy/autocracy in 1920, while Lithuania received a +7 in democracy and a +4 in combined democracy/autocracy.[28] The conflict is seen by both Polish and Lithuanian historians as a part of the wars of independence from the Soviet Union (see the article on the Polish-Lithuanian War). Operation Fork: The British invasion of Iceland in WWII Continuation War:[29] A formal state of war between the United Kingdom, Australia and Canada, on one side, and Finland on the other, resulting from the Finnish invasion of the Soviet Union in 1941; there was actual conflict between the United Kingdom and Finland, including an air raid against Finnish territory, with associated attacks on Finnish shipping, although that took place some months before the declaration of war.[30] Israeli War of Independence: as against Lebanon; Israel had not yet held elections.[31] First Kashmir War Ranked as a full-scale war between democracies in the International Crisis Behavior dataset;[32] they present a table of crises ranking it as a full-scale war, cite it as an example of a crisis where both regimes were of the same type, and discuss the influence of India’s democracy on the crisis and the related crises over other princely states.[33] There were fewer than a thousand battlefield casualties in this war.[32] Both countries, then Dominions, then had governments based on the Government of India Act 1935, implemented 1937, which set up Westminster democracy for all of British India;[34] in Pakistan, the politicians, at odds with the civilian bureaucracy, failed to maintain civilian control over the military, and converted the Governor-Generalship into a political office; there was a military coup ten years after the war; the Polity IV dataset counts it as anocratic until 1957-8 (see above), the years before the coup; the same dataset shows India as having been a stable democracy throughout the period.[35] The Cod Wars: a series of violent fishing disputes between the United Kingdom and Iceland Six-Day War: The Lebanese air force intervened against Israel, both then being democratic states;[36] the same policy set classifies Lebanon as an anocracy, its neologism for imperfect or disputable democracies.[37] although it was called at the time “the only Arab democracy.”[38] Football War[39] Turkish invasion of Cyprus. An attack by the new democracy in Turkey, since 1973;[40] Cyprus had been a constitutional democracy, although one with severe intercommunal problems, since independence in 1958;[41] the Turkish invasion was a response to a coup. The democratic order of the Republic of Cyprus was restored three days after the invasion, and the war continued for another month.[42] Page Fortna regards this as a debatable case of dual democracy.[43] Paquisha War: War fought in 1981 between Ecuador and Peru. The leaders of both countries had been democratically elected. Ecuador receives a rating of +9 in the polity scale of combined democracy/autocracy, while Peru receives a +7, meaning that both countries are classified as democratic, and Ecuador even as “very democratic”.[28] However, the “war” involved only as high as two hundred deaths in battle. Furthermore, the Peruvian democracy was less than one year old and the Ecuadorian less than 3 years. In addition, both nations lacked democratic control over their militaries.[44] Kargil war, between India and Pakistan. [edit]

Took me about 35 second to find that out…. but you know what is easier? Keep living in your own little bubble.

The National Socialist Party never obtained a majority of votes in any German election. In fact, the Nazi Party lost seats in the last open election in 1932. Rather the President von Hidenburg and the German Army simply handed the Nazi’s power (in coalition with the Conservative Party and once Hitler agreed to purge the SA of certain unreliable members). Even after Hitler had seized emergency powers and released their SA thugs in huge numbers to terrorized the German electorate, the Nazi were still unable to get a majority of votes in 1934.

With that said, democratically elected governments do indeed go to war with each other.

I am Gordon Chang, I have predicted China’s imminent collapse since 2001-2012 and my only correct prediction is that I will keep predicting about China’s imminent collapse.

But it seems like I have been making a fool of myself, therefore I got smarter, so instead of saying China is going to collapse in 2012 (Google: The Coming Collapse of China: 2012 Edition by Gordon Chang) or in 2013, 2014 etc…

I will do the next best thing, I will go ahead and find any and every little bit and pieces of data that will support my life long aspiration and hope that China will collapse, and I will keep expanding on those little piece of data to make them seems like a trend of China’s fail future, so in this way even if I am not directly saying that China will collapse in , but I am actually saying that China is going to collapse just like the book I wrote in 2001 and my yearly prediction about China’s collapse every year thereafter.

Thank you Gordon Chang for a one-sided report. For a momemnt I was worried about the economic future of Chinese manufacturing. It was a big relief when I checked and recognized the name. I had a good laugh.

Amazingly funny this Gordon Chang. LOL. I’m taking a break from my watching Oscar presentation. Gordon’s recipe: why any topic that would Stir some kind trails where the lemmings would follow to their virtual fall.

As I explained before, Microsoft is an 8,000 kg gorilla that is extremely difficult to beat. Google: Steve Sinofsky http://en.wikipedia.org/wiki/Steven_Sinofsky

China is like a huge system composed of 8,000 “Microsoft”s, thats 8,000 x 8,000 hugggge! :)

China’s economy is now into its Internal Economy phase, that is the “domestic consumption” and one of the Key components of their well-oiled machines is the new high-speed trains lines. It is revolutionalizing China’s economy all over.

when all you can buy in US and European stores are made in China products, your people and your country will surely but slowly become paupers. You cant solve the problem of Europe and America unless they produce their own product. IF your people have no work, they they will have no money to buy. You should abolish free trade since China will kill competition until only his products remain on the market, and then he can control the supply and the price. wake-up intelligent white people, are you too hungry now to think…

Thank you Gordon for piecing all these data together. It is impossible for most of us to get such a good picture by reading headlines.

I am wondering how much of $9.3 billion in FDI last month is illicit detour of domestic money.

The risk of doing business in China, a political volcano, is always there, and this is why political insiders (i.e. the regime’s officials) are moving their assets and family members overseas rapidly. Pollution in China are killing people daily in large numbers. Just take a look at the 247 Chinese cancer villages (http://english.cri.cn/6909/2013/02/25/2743s750357.htm) from partial surveys, and the air pollution of major Chinese cities (http://www.hzhang.org/air_quality/). I believe is the CCP that taught us there revolution arise when people have nothing to lose. Tolerating pollution is one of the major factors underlying the low cost of Chinese production. I would think people feel they have nothing to lose when they are about to die, even if slowly.

Fascinating post. I did a piece here a few months ago about Zurich Re analyzing supply chains a couple of levels deep. The tsunami in Japan and the floods in Thailand, not to mention the various storms that lashed America’s East Coast, made companies pay attention to the risks they face. The cyber disputes looming between China and much of the rest of the world could impact trade as well. Great forward look here.

While I don’t dismiss your article as inaccurate, Foxconn may indeed be investing for growth outside China. But why would they focus investment in Taiwan if geo-political risk is one of the main motivators for diversifying out of China? Taiwan would be ground zero for geo-political disruption originating from China, and would suffer far more than any facilities on the Chinese mainland.

More likely it is simply a prudent diversification move from a company that has matured to the point where it realizes over-reliance on a single national economy is contrary to its interests. It’s a common trajectory for major enterprises to expand its operations internationally.

If you think Norma`s story is unimaginable…, 3 weeks ago my girl friends mom basically also earned $5547 just sitting there twelve hour’s a week at home and the’re buddy’s sister-in-law`s neighbour has done this for 4 months and got more than $5547 part-time at their computer. use the advice from this website… jump15.comCHECK IT OUT

Here is an excellent example, his article about China’s rust belt. When in fact, those rust belts actually an indicator that China is moving upward by shifting to higher-value intelligent based technologies, but Gordon compared them to Detroit. LOL.

“”One of China’s five-axis machine tool makers has 24 distinct models. China now has 28 companies capable of building more than 1,000 CNC machine tools. There are 130 Chinese companies with annual capacity of more than 100 machine tools. The country is now supplying most all of its own demand, with only 10 percent of the market being supplied through imports. “In 2005, approximately 59,600 units of CNC machine tools were produced in China,” according to the BIS report. In 2007, the combined amount of CNC metal-cutting and forming tools produced in China was 126,268, more than double the amount produced in 2005. China is now supplying its own demand for five-axis machine tools used throughout its military.”

— . .

U.S. Precision Machine Tool Industry Is No Longer A Global Competetitive Force

U.S. producers of some of the most technologically advanced machine tools are in trouble, according to an assessment by the Department of Commerce. Sales of high-precision five-axis machine tools are declining. U.S. share of global exports is in a freefall. Foreign companies in China and Taiwan have caught up with U.S. technical capabilities, rendering stringent U.S. export controls moot. U.S. companies are being purchased by foreign rivals. A lack of training programs has created a shortage of skilled workers able to use the complex machinery. Commercial and U.S. government customers prefer foreign machine tools. Export controls are hampering foreign sales. The entire U.S. machine tool industry spends only $1 million a year on research on five-axis machine tools.

These are some of the findings from a “Critical Technology Assessment” conducted by the Commerce Department’s Bureau of Industry and Security.

U.S. producers of five-axis machine tools had sales of $253 million in 2008, down 11 percent from 2005 sales of $284 million. That was before the U.S. machine tool industry suffered a meltdown in 2009, when domestic consumption tumbled by 60.4 percent, according to the Association of Manufacturing Technology.

Sales of five-axis machines to domestic customers from U.S. producers declined by 19 percent from 2005 to 2008, from $242 million in 2005 to only $195 million in 2008. There are six American companies dedicated to producing five-axis machine tools, and at least 20 in China. Five-axis tools are used for the production of precision components in the aerospace industry, in making gas and diesel engines, automobile parts, and throughout the medical, textile, oil, glass, heavy industrial equipment and tool industries. “Many other industries are discovering the advantages of these machines,” says the Bureau of Industry and Security (BIS).

Yet “only a handful of U.S. producers actually manufacture five-axis machine tools in high volume and most generate less than 10 percent of their annual net finished machine tools sales from five-axis machine tool business lines,” according to the market and technology research report from BIS.

U.S. producers of five-axis machine tools exported only $58 million worth of equipment in 2008. In a tally of global exports of all machine tools, the United States — with exports of $740 million — accounted for only 4.3 percent of global exports in 2007.

In its survey of 61 American end-users that purchased 502 five-axis machine tools worth a combined $900 million, imports accounted for 70 percent of purchases. “Across model types, the number of imported models greatly surpasses the number of domestic models for grinders, mill/turns [and] machining centers,” says BIS. “However, domestic-produced mills slightly outnumbered imported mills.” The average purchase price for a five-axis machine tool was $330,000.

BIS also surveyed 109 U.S. machine tool distributors. It found that 80 percent of the five-axis machine tools they sold in the United States between 2005 and 2008 were imported, with Japanese and German machines making up the majority of models. “Five-axis machine tool distributors, most of which are selling only non-U.S. five-axis machine tool models, have clearly positioned themselves more effectively in the domestic market,” says BIS. “The growth rate of distributor domestic five-axis simultaneous control machine tool sales in 2005-2008 was 3 percent,” says the study. “This compares to a precipitous decline of 20 percent in domestic sales among U.S. producers over the same 2005-2008 period.”

There are not many U.S. producers of five-axis machine tools. Only six of the 109 U.S. machine tool companies surveyed devote 25 percent or more of their current production capacity to these high-end machines. The remaining producers of machine tools have either shifted production to other machine tool lines, or have moved production offshore. Other producers say U.S. export restrictions have forced them out of the business.

Companies making five-axis machine tools in the United States take a lot longer to build them than foreign rivals. BIS gathered information on 477 five-axis models, 96 of which were produced in the United States and 381 of which were imported. “BIS found that U.S. producers take almost twice as long as foreign producers to manufacture custom-built models, on average,” says the study. “However, U.S. producers were able to manufacture standard models 25 percent faster than their foreign competitors.”

BIS found that half of the commercial five-axis machine tools are purchased for government contracts. The majority of these purchases are used solely for the purpose of government work. “Non-U.S. produced models made up 64 percent of five-axis simultaneous control machine tool models in the inventory of U.S. government contractors,” says BIS.

BIS also assessed foreign producers of five-axis machines. It found that not one of the 45 companies that are indigenous to Brazil, China, India, Russia and Taiwan use U.S. technology, parts, components or materials. China has 20 indigenous five-axis machine tool companies; Taiwan has 22. None of these companies have to deal with the types of export restrictions facing American firms. As a result, these companies are able to produce all the machine tools that are in demand in China and Taiwan, plus they are “able to produce in sufficient quantity to export to other LRCs,” says BIS.

One of China’s five-axis machine tool makers has 24 distinct models. China now has 28 companies capable of building more than 1,000 CNC machine tools. There are 130 Chinese companies with annual capacity of more than 100 machine tools. The country is now supplying most all of its own demand, with only 10 percent of the market being supplied through imports. “In 2005, approximately 59,600 units of CNC machine tools were produced in China,” according to the BIS report. In 2007, the combined amount of CNC metal-cutting and forming tools produced in China was 126,268, more than double the amount produced in 2005. China is now supplying its own demand for five-axis machine tools used throughout its military.

The BIS quotes the Export Compliance Working Group of the American Chamber of Commerce in the People’s Republic of China as saying: “Given the existing domestic and joint venture development and the foreign availability of high-level machine tools, U.S. companies could not make a material contribution to China’s military development. China’s military demands are already satisfied by domestic and foreign supply.”

The United States exported 515 five-axis machine tools between 2005-2007, and only 12 of these went to China. DMTG, China’s largest producer of machine tools, exports products to more than 100 countries.

The Bureau of Industry and Security is in charge of licensing the sale of five-axis machine tools for export. From 2004 to 2007, it issued licenses for the sale of 148 machines, but only 34 of them were sold and delivered. BIS asked the U.S. producers and distributors who applied for the export licenses why so few of the orders were fulfilled. “Many respondents indicated that the customer cancelled the sale after the export license was obtained or bought a competitor’s product,” says BIS. “One Chinese customer cancelled a sale because it took the U.S. company seven months to obtain an export license, and in the end, the license conditions were too extreme in the customer’s view.”

The number of licenses issued for export of five-axis machine tools to China dropped from nine in 2006 to only three in 2007. “As one exporter noted, ‘the costs associated with the uncertainty of obtaining a license [and] the protracted process and impact on customer relations offset the financial rewards of pursuing the [five-axis] business.’ ”

The few remaining U.S. producers all said that export controls are impacting their ability to remain competitive globally. Foreign customers can obtain the comparable systems much faster from European and Japanese companies. European and Japanese governments process export licenses twice as fast as U.S. export control agencies. One U.S. five-axis machine tool producer told the BIS analysts: “ Foreign entities with knowledge of the multi-axis simultaneous control machine tool industry view the U.S. export control policies and requirements as an additional burden to consider when dealing with U.S. multi-axis machine tool manufactures.” As a result, they no longer even consider U.S. producers when shopping for five-axis machine tools.

The report is located at http://www.bis.doc.gov/ defenseindustrialbaseprograms/osies/defmarket researchrpts/final_machine_ tool_report.pdf.

Summary: China looks to lower the cost of 3D printing and make large titanium components to build the next-gen fighter jet and self-developed passenger plane.

By using laser additive manufactured titanium parts in its aviation industry, China is looking to become a global leader in commercializing 3D printing technology.

The laser additive manufacturing technology not only lowers the cost of titanium parts to only 5 percent of the original, it also reduces the weight of the components and enhances the strength of complicated parts.

As much as 40 percent of the weight can be reduced if the forged titanium parts on an American F-22 were made using the Chinese 3D printing technology, according to a a report on Chinese Web site, Guancha Zhe.

With funding from the government, especially from the military, the Chinese aviation laser technology team is making headways in making titanium parts for the country’s fifth generation of fighter jets, the J-20 and J-31, by lowering the cost and raising the jets’ thrust-weight ratio.

The Northwestern Polytechnical University of China is also making five meter-long titanium wing beams for the C919 passenger plane, which is scheduled to be put into commercial operation in 2016.

“As the aviation technology develops, the components are also getting lighter, more complicated, and also need to have better mechanical properties,” said Huang Weidong, director of the university’s laboratory, to a local newspaper. “It is very hard to use traditional technologies to make such parts, but 3D printing could just meet such demands.”

You must learn to think like a Builder. If you want to build a great building, it must last for tens and hundreds of years! Do not worry about some Corrosion due to heavy snow from time to time.. nor should you care about electrical fuses blowing out :) Rather, think long-term!

Science is moving eastward towards China, and India will eventually join China.

.. .

In the summer of 2008, the journal Nature published a short, illuminating essay that tracked the global migration of scientific research over the centuries, as empires rose and fell. The center of world science, for instance, was in France in 1740, before it moved to Germany, then Britain, and, later, America, carrying with it, in each case, a major dimension of global leadership. The authors—J. Rogers Hollingsworth, Karl H. Müller and Ellen Jane Hollingsworth—have concluded that another scientific superpower is unlikely to emerge with the same dominance as its predecessors. They have also discovered that great shifts in global scientific leadership follow a clear pattern: “Each former scientific power, especially during the initial stages of decline, had the illusion that its system was performing better than it was, overestimating its strength and underestimating innovation elsewhere. The elite could not imagine that the centre would shift.”

Just like Fibonacci series etc.. they are All applicable to other aspects of life, be it the Waves cycles in China etc.

Gordon (author) due to his anti-China agenda and huge bias is always trying to pick a bone with China. LOL. But what is picking the bone is a small dent here and there (be it for real or his “invented/warped” interpretation), these are just a tiny ups and downs of Huge Waves.

The lemmings readers who are unfamiliar with these fundamentals would then just eat Gordon’s words as if it is a cheese, but those who are in-the-know can see the actual trends. The trends are your friend :)

Mr. Chang is definitely not anti-China. Who, but a fool, would be pro-ChinaGov?

The trends which must be watched are those involving interactions between human population and energy, water, land resources and biodiversity.

We must also never neglect to factor in the downward trend in human intelligence when good men, such as yourself, become irrationally complacent concerning the ill-conceived great leaps they see being made in Red China.

Whatever the ChiComs do these days is nothing more than a hill of Azuki beans compared to all the good which might have been done if someone had slit Mao’s throat when he was a toddler whistling and peeing almost everywhere.

Where is China heading to? In order to answet that, you need to understand that China actually has more “checks and balances” compared to that in the US.

Note: the reason the US had the big Crash in 2008 was due to former Fed Chairman Greenspan sleeping at the wheel ! Toxic mortgages were all over the places year before 2008, and Fed did Not intervene!!! .

Then, you need to hear directly from the professional investors who have actually set their feet inside China and put the money where their mouths are… bavk by decades of solid experience.

If I must hear one more utterance from that bow tied, bow legged, motorbike riding Jim Rogers during this year of the snake, then I will have his head before I am through, and drink his bile before subjecting myself to any more of his observations.

When Rogers moves his family to Beijing, the Red Gov will have fallen.

To help me qualify to ride on Dennis Tito’s rocket to Mars and back, if I wish to come back.

You might be a complete commie or a John Bircher, I still won’t drive you mad on the way out to the Red Planet, if only you will have me.

I plan to set up a new and much expanded Martian Pirate Bay which will Pirate and electronically disseminate everything ever copyrighted during the past 80 years in any language .

All leechers and pirates may choose to offer assistance setting up the first Martian Pirate Bay Base Interplanetary Internet connection to Earth.

The Interplanetary Internet connection to Earth will have the secondary unstated purpose of reducing the height/length of all Communist Members by 5 centimeters through elective shin bone surgery, a proven technique now often used to make Chinese babes taller. And they like their Commie Party Members smaller.

“Developing countries, led by China and Brazil, will see greater progress in their economic recoveries, as high-income countries continue to struggle in the wake of the global financial crisis of several years ago, according to a World Bank report.

According to the bank’s latest Global Economic Prospects report published on Wednesday, its growth prospect for the global economy in 2013 was slashed to 2.4 percent from a June 2012 estimate of 3 percent.

But China’s growth will pick up from an estimated 7.9 percent in 2012 to 8.4 percent this year, said Kaushik Basu, its chief economist at a news briefing in Washington on Tuesday. The 2013 prediction was lowered from a previous 8.6 percent.”

I think the author have to get some facts right. The brush with territorial problem was started by Japan to nationlizing an island which was previously agreed upon by both governments to send any provocative actions on DiaoYu island. An article published here citing a Japanese professor studying the history of the incident stated the island sovereign rights belong to Taiwan not Japan or China.

Without provocations and blockades from US in trade and sea routes, there won’t be any heat. Every nation also wants to ensure and protect their trade routes and oil supply. I am just stating the reasonable facts not trying to side any countries but we should be neutral and factually right.

Interesting view points. But In China, we do not think work for Foxconn is a good job. This company just can not do same business in USA, Mr. Guo will face more trouble in USA if he really wants to treat the staff of Foxconn as same as he is doing in China. He never ever care about the consideration of the workers of Foxconn. At the same time, the low-end labor market supply in China is pretty tight, the salary level is increasing quickly , no more cheap labour force still available for him, that is the main reason he is trying to find “new” places to go. Unfortunately, he has enjoyed so many political and economical benefits from Chinese government, I am not really think it is easy for him to find a better “new” places. To be straight forward , his business model is passing away. May be what he really could do is to find “new” business model and management philosophy.

Yes, Mu. But don’t you think he already is? Seems that Gou is now thinking Robotics and Automation. This is the smart move for all the reasons you mention, and more. I hope he succeeds with his Robotics and Automation strategy in a big way because we just don’t need so many men and women stuck in jobs which are only really fit for robots and machines. So I hope Gou will succeed.

There is good reason to diversify manufacturing locations. Foxcon had a goal of adding 500k robots in the next 2 years. A 97% return after the New Year is astounding number. Definitely changes hiring plans, fewer needed and higher productivity with the trained workers returning.

Brazil has local content rules and a rapidly growing market for electronics. This will support larger operations.

High levels of new automated factories near the development team is good practice. There are more changes involved other than swapping equipment for labor. Some that allow other beneficial changes such as improved quality, throughput and reduced cycle time. There unexpected problems when running anything at scale even with a great deal pf planning and simulation.

Electronics follows sneakers. Shoe companies have had suppliers manufacture in the current low cost region, Vietnam, Indonesia,etc. As the infrastructure improves, including skills, government services and regulations, transport, simple, low cost electronics start to be assembled. Indonesia has the scale that could support a large Foxcon facility.

Mexico facilitates could increase, close to the the customer has its advantages. Reworking 8 containers of product is very expensive, flying in product due to demand change is expansive. The quality level and supply chain has improved in Mexico and it has a substantial domestic market.

US will not have one of the 20k employee sites. Very difficult to hire that many in one site with out affecting wages, housing costs and other related issues. Remember Foxcon is a low cost supplier, a boom would wipe out the local labor, including technical resources. Small 200-2,000 sites are possible for specialized markets. For scale, the largest single site, private US employer is Disneyworld with 64k employees.

Europe is similar with Germany/France and Romania, Hungary with Poland in the middle.

All these are drivers other than concerns for government stability. China has made astounding changes in the last 50 years.

As for China’s pollution, they are working hard on it. With the incredible increase of vehicles on the road, coal fired power plants, smokestack factories and homes with heat and cooling there are tremendous challenges to the air and water. The drive is coming from China itself. Bad air and water hurts the countries productivity and the people are complaining.